Starting your own Groupon site

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My wife trolls deal sites everyday looking for deals to save us 50% on romantic dinners or 70% off on Hotel stays or even 90% off on skydiving. Deal sites like Groupon and Mydeals are popping up everywhere these days that you’d look like a fool if you bought a meal at …regular price (gasp!) .

However, if you’re not contented with just trolling the 10 deal sites you subscribe to, you might want to start your own groupon site. Think about it, it’s an easy business model, you require limited upfront capital and you’re more or less just a middle man, you’d think anyone can do it. Well it turns out everyone can do it, and a lot or people are. Here’s 3 ways to start your deal website and be on your way to Groupon like fame (or infamy)

The market for deal sites appears to be reaching saturation, even in Malaysia we have so many of these deal sites I’ve lost count after 10. The competition is stiff and the deals are harder to come by, plus I’m always skeptical that the 90% off skydiving wasn’t just a scam (was it really 90% off the regular price or 90% off an overly-inflated price?)

The biggest draw obviously is that it’s profitable, Groupon turned down a $6 Billion dollar bid from Google, you read that right it’s Billion with a capital B, and over here in Malaysia Groupon has had to compete with sites like StreetDeal and MyDeal, so much so it acquired Groupsmore and turned it into a Groupon Malaysia.

So let’s say you’re confident you can start a deal site with enough differentiating qualities you can stand out in a crowd, and let’s say you’re not worried about competition and just wanna see what you can do. What do you need to start a Groupon site?

From an IT perspective all you really need is the technical infrastructure, and with cloud computing and hosting packages so easy to come by, all you really need….is the software. So where do you get the deal site software and which one is the best? The answer is I don’t know, because I haven’t tried them all, but here’s my favorite picks based on the reviews I’ve read.

Use a wordpress template.

Yes, wordpress really is that powerful.

The guys over at Templatic have a wonderful template that allows you to create a Groupon like deal site by just utilizing a wordpress theme. It really is amazing. You can check out a demo of their template here. The template is called daily deals and allows up to 7 mode of payments, Complete moderation of deals and even One Click – Auto install of the theme. Which means in very laymans terms, your IT savvy nephew should be able to help you get this up and running in no time.

The template comes with 2 licensing deals:

USD89.95 for a standard license and USD 159 for a developer license which has extra support. If you’re not so IT Savvy I’d spend the extra 70 bucks for the support.

Use a platform

There’s a t0n of free PHP platforms you can use to host your own deal sites, most notably Wroupon and GrouponClone. While Wroupon sells for around the same price as  daily deals wordpress theme, GrouponClone sells for a whopping USD499. That’s some large cash to be spending, but you probably get more flexibility.

Another entry in the platform section would be ndot.in , which is a bit patchy particularly since they don’t advertise the price of their fully paid version. They do however have a free opensource version for you to demo…beware you can’t run a proper Groupon site of the free version.

Subscribe to a service

Finally we come to my favorite Groupon model. This model is where you don’t host anything, and all the IT is done by professionals. There’s a huge advantage in that you don’t have to rely on your nephew for support (what happens when he goes to college?) and you can keep your site running smoothly, since it’s professionals running the show with constant updates so you don’t have to worry about security updates and patches…awesome!

What this really means is that rather than focusing on your Deal site, you can focus on your Deal BUSINESS!

Now some techies may not like the idea and that’s entirely your choice, but be wary that supporting even a simple wordpress site takes time and it takes a lot more time when you aren’t IT savvy.

The downside of this model though is that it’s got a different pricing strategy than the previous 2. In this model someone is constantly supporting you, so they need to constantly charge you to make money.

The only option in this category (I could find) was a site called getsocio.com and they charge USD15/month AND 5% of all sales. What this means is that your initial startup cost is nothing, but as you go along the price of the website could cost you more than the option of hosting it yourself. The upside is you don’t have to worry about IT stuff.

Personally I like getsocio, they have inbuilt paypal functionality so you can receive payments via credit card..etc etc through the paypal API. It’s amazing, but seeing as how you have to paypal about 3% of your transaction feeds and then pay getsocio an additional 5%, it may get a bit difficult to make money for a site that’s about getting thing cheaper.

Conclusion

Like I said, I don’t know the best option, but there are options and you’ll need to make your decision based on:

  • How much upfront capital you want to spend
  • How IT savvy you are and;
  • How much time you’re willing to spend supporting the IT systems
  • How much profit margin you’re anticipating and;
  • How much transactional cost can you afford

Overall though, starting a deal site isn’t difficult technically, but running it is another story.

Picture courtesy of http://www.flickr.com/photos/fstorr/5283549962/sizes/o/in/photostream/

7 comments

Leave a Reply to Angela AddisonCancel reply

  • I think, staring a new deal site is not very good idea because of two main reasons:

    1 – As you mentioned there are many deal sites already in the market and going to the market and standing out of this crowd needs a very good marketing and needs resources.

    2 – Anther main point which you have mentioned is if the deals are really deal or just showing fake numbers to consumers to convince them to buy the deal!!? I believe in long term people will come to this conclusion that most of the regular prices are fake and in fact they will get what they paid for. (To my experience except one deal, after using these deals for two years now, I got what I paid for and nothing more) so now I am thinking if this is the case why should do this!? I believe people eventually come to this conclusion, but always would be customers which buy these deals. but the market would not be like this anymore and imagine there are many deal sites competing yet.

  • Great post to read out. Thanks for the post. I feel “Groupon clone” would be good as compared to wroupon. Because while going through their websites, wroupon is built on wordpress and groupon clone is built on magento. I always suggest magento is always a safer platform for ecommerce business.

  • Good and useful post. Starting a groupon clone is not easy. Because we have to concentrate on both admin part and users experience in the website. So while searching for those requirements which matches both admin and users is “GrouponClone” Script you mentioned above. This script works good and almost it gives same shopping experience as Groupon gives us.

  • A good post with worthy ideas to start our own groupon site. I have chosen Contus Groupon clone a readymade daily deal script for my daily deals website and it came out well more than i expected!

  • Good write-up!! Groupon is already a trusted and famous deals website, why anyone will go with your new website? You must provide your customers a reason to visit your website. This can only be happen if your website will be having a unique feature.
    Yo!Deals is an advanced daily deal site builder which offers unique multi-vendor and product selling feature. With multi-vendor features, admin will be able to add multiple merchants into the daily deal system who will be different yet related deals to your services. With related deals, means those deals which you are not offering but your neighbor merchant is offering. You can earn money on every deal clicked and coupon redeemed.